- The daily transaction count on the first cryptocurrency’s network has fallen 53% from its September peak.
- The decline in on-chain activity is partly tied to waning interest in the Runes protocol.
- Based on current metrics, CryptoQuant analysts conclude that bitcoin is overvalued.
CryptoQuant reported a marked drop in transactional activity on the first cryptocurrency’s network. According to the firm, bitcoin’s mempool is almost empty.
From its November high, the Network Activity Index fell 15% to 3,760 — the lowest reading since February 2024.
The gauge sits well below its 365-day moving average — a set-up last seen in July 2021 after China’s mining ban.
At present, the bitcoin network processes roughly 349,000 transactions per day.
Compared with the ATH of roughly 734,000 reached in September, the figure is down 53%.
Why activity collapsed
Analysts largely attribute the fall in on-chain activity to fading popularity of the Runes protocol.
«This is confirmed by the trend in the total number of OP_RETURN in bitcoin transactions, which the protocol uses to record data on token issuance and transfers,» CryptoQuant explained.
After the protocol launched in April 2024, daily OP_RETURN opcodes peaked at 802,000. Since then the trend has dropped sharply, with the current reading below 10,000.
The mempool is almost empty
Another clear sign of subdued on-chain activity is the depleted mempool.
«The total number of transactions waiting in the mempool to be included in a block has plunged from 287,000 in December 2024 to the current 3,000 — a 99% drop. The last time the mempool was this empty was in March 2022,» the analysts observed.
What is bitcoin’s fair value?
Considering current on-chain data and Metcalfe’s law, the analysts reckon bitcoin’s fair value lies between $48,000 and $95,000 (between the blue and red lines on the chart).
«At the current price of $99,000 [at the time of writing—$95,890], the asset looks overvalued, given that since February 2024 it has traded within this range,» the experts concluded.
Earlier, CryptoQuant pointed to a “cleansing” of the crypto market from excessive leverage.